Foreign direct investment or FDI is when a foreign investor invests in a business that has its roots in another country. This type of investment is made with the intent of a ‘lasting interest’ in the business of another country. This lasting interesting is established when the foreign investor (individual or organization) gets a minimum of 10 per cent of voting rights in the business based in another country, as per OECD (Organization for Economic Co-operation and Development).
A controlling ownership is what differentiates foreign direct investment to foreign portfolio investment.
India opened up its economy to foreign investors in 1991. Since then, the government has taken several steps in order to encourage foreign investors to invest in the country and therefore, increase FDI equity inflows.
As we enter into 2020, more companies today are looking at FDI as a funding option as an alternative to borrowing funds from within the country. One reason for this may be the high rates of interests and the rigid framework.
Now, this does not mean that borrowing funds from overseas is easy. It can, in fact, become complicated and even overwhelming for many. This is where we step in—to ease out the entire process for you. We at FDI India smooth out all ruffles that may hamper your path to a successful business. We have associations with diverse investors located across the globe.
While you may be having the right business idea and the perfect blueprint, you may be facing difficulties finding the right investor for your business. We help you find the right foreign investor for your business.
Apart from connecting you to an overseas investor, we also help you through the entire process of foreign direct investment.
There are two ways in which a foreign investor can invest in India:
- Automatic Route: Foreign investments are permitted under this route without any prior approval from the government or the Reserve Bank of India.
- Government Route: Foreign investments in sectors not covered by the automatic route require prior approval from the government and its related ministries.